The Provincial court of Madrid has given the reason to the consumers in the macrocausa against the clauses in land foreclosures, driven by the consumers ‘ association ADICAE. The court, in a ruling communicated this Friday, voids such clauses because they are considered abusive, it orders the return mass of the overcharged, with interest, and confirms the retroactive effect from the date of signing of the mortgage contract. The demand affects virtually all banking institutions that include this type of provisions in their contracts.
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The Hearing confirms the first-instance decision of the Commercial Court number 11 of Madrid, which already has ruled in favour of consumers in April of 2016 and declared null and void the clauses ground for considering them to be unfair. But the fixes. The court of first instance imposed a temporary limitation that now the court eliminates. The Provincial court now recognizes the right of injured parties to recover all sums paid over to the banks, to which are added the legal interest. Banks should return everything from the beginning.
Initially, the macrodemanda joined more than 9,000 individuals concerned and went to 101 banks, which have finally been in 40 after the merger. The retroactivity total goes in line with the judgment of the Court of Justice of the European Union (CJEU) in December 2016, determined that banks should refund in full the money charged by the application of the clauses ground and that fixed the Spanish Supreme Court, which in 2013 had ruled that only had to return the money from then on.
“Proceed to the estimation of the resource of ADICAE in respect of this matter of the full restitution of the amounts charged to consumers affected by the application of the so-called clause soil, without the temporal limitation is appreciated in the judgment of the first instance,” says the ruling, which adds that the status of the case-law (judgment of the CJEU) “waived because of the criteria used previously.”
ADICAE estimates that, on average, the amounts that the dealer will have to pay each affected range between 12,000 and 15,000 euros. The employer’s bank AEB has declined to comment on the judgment.
The resolution can be appealed in cassation before the before the First Chamber of the Supreme Court in the next 20 days. The court also imposes costs attributable to the resources or the challenges of two dozens of banks that have been rejected. Among them, Caixabank and Bankia.
The banks have been over the years, including so-called clauses soil in their mortgage contracts. With the constant fluctuation of the euribor —the interest that are referenced most mortgages in Spain— the bank included in the contract ceilings on that interest is not increased even if the euribor went up above (ceiling) and a few caps under which the interest could never be reduced (ground).
last year, after the european court forced the banks to return all paid for by the clauses soil, were created 54 special courts —one in each province in the Peninsula, two in the Balearic islands and two in the Canary islands— to face the onslaught of demands of the affected. The citizens have already gone to the courts with 305.437 demands for all kinds of clauses that are considered abusive: both clauses soil, as early maturity, interest thereon, expenses of formalization of the mortgage or mortgages multi-currency cross-referenced to foreign currency. Of these, only one out of every four has been resolved. Banks lose 97% of the cases.
The Government established in parallel to a channel-court settlement for the affected claim. Until August 31, 2018, the credit institutions have received 1.166.485 refund claims for amounts charged unduly in clauses soil. Of them, the banks estimated 68.5% (517.502) and, of these, 93% completed with agreement between the parties. In total we have returned to 2.292 million, which represents an average amount returned to customers 4.430 euros. However, the entities have refused to return the money in 226.148 cases, 29.9% of the admissible, in spite of having clauses soil.
The minister of Justice, Dolores Delgado, announced some weeks ago that the Government is preparing regulatory changes to penalize the banks who insist on going to the courts and to lengthen the process with remedies in cases of unfair terms. Among the measures that advanced the Slim to solve the collapse of the specialized courts in these lawsuits, it highlights the taxation of interest punitive to banks when acting with bad faith to extend the process or delay the return of money to clients. The goal would be to force them to come to the court, which is now barely used.